Success with in house collections?

I'm looking for some feedback with regard to in house collections. Has anyone out there had success bringing their collections in house? Or better success with using a collection company? Any feedback or suggestions would be greatly appreciated. Thanks!

Hello James,

I think the answer is either one could work based upon the relationship the manager has with the residents and how large the property is that they have to manage. The other one is how big are the monthly collections.

Myself, I was always a fan of inhouse. I had a hands on with the tenants and there was more success there, and they were more responsive as I knew how many times they had been notified as well as I was able to get direct feedback and did not have to share with a collection company.

Now this may not work with real large communities. I think it is a judgement call on the part of the management company/owner and the manager at the property level. One also has to know their strong and weak points when dealing with the issues of collections.

Hi James,

In House can be good because you don't have to give up a portion of the money, but using an outside vendor can be useful because they have the power to garnish paychecks or seriously affect a former residents credit score.

Personally, I've had a fair amount of success with in-house collections.

12 years of Catechism School = one dozen years of guilt trip experience. :ohmy: If the departing resident has (or is able to borrow) the money, they usually write me a check the day they turn in their keys. I prepare them for this by being forthcoming about potential charges before move in, during residency, and right after notice to vacate.

I have had more luck collecting through a professional collection company. I give everyone 30 days after move-out to pay their balance or make a large payment toward it. If I don't receive it, I send it to collections.

I make it very clear before they move that their balance due will go on their credit report for 7 years if they don't pay it or make their payments. I rarely get anything because they have usually found housing by then and don't care.

It's usually a year or two later when they start looking again that they call and want to make payment arrangements with me. By then, it's too late.

I would like to start collecting in-house with a better plan. A friend's property files a judgement with our Magistrate if they don't pay it. They have had a lot of success with this.
I would love to hear success stories and a good plan to make it happen. Would anyone share theirs with the rest of us?